How is wealth? invested of pharmaceutical? company

Assignment Help Financial Accounting
Reference no: EM132927890

A big pharmaceutical? company, DRIg, has just announced a potential cure for cancer. The stock price increased from $2 to $150 in one day. A friend calls to tell you that he owns DRIg. You proudly reply that you? do, too. Since you have been friends for some? time, you know that he holds the? market, as do? you, and so you both are invested in this stock. Both of you care only about expected return and volatility. The? risk-free rate is 4%?, quoted as an APR based on a? 365-day year. DRIg made up 0.35% of the market portfolio before the news announcement.

Problem a. On the announcement your overall wealth went up by 1.3% ?(assume all other price changes cancelled out so that without? DRIg, the market return would have been?zero). How is your wealth? invested?

Problem b. Your? friend's wealth went up by 1.8%. How is his wealth? invested?

Reference no: EM132927890

Questions Cloud

What is the average cash gain or loss during the month : What is the average cash gain or loss during the month? Kraft budgeted sales are $5,000 per month and let's assume the sales stay the same every month.
Determine the ACB of Alan partnership interest : Alan and Brindha began a partnership carrying on an active business in 2020. Determine the ACB of Alan's partnership interest on January 1, 2021
What is the balance of the flora sinoyianis : What is the balance of the Flora Sinoyianis, Capital account? Sinoyianis Realty Company had the balance sheet accounts and balances.
Calculate the net present value : The project requires $830,000 in initial net working capital investment to get operational. Calculate the net present value
How is wealth? invested of pharmaceutical? company : How is your wealth? invested? A big pharmaceutical? company, DRIg, has just announced a potential cure for cancer. The stock price increased from $2 to $150.
Discuss what this new information might convey : Discuss what this new information might convey concerning Black Ltd management's belief concerning the future of the company
Describe the various corporate governance mechanisms : Describe the various corporate governance mechanisms. Be sure to discuss the merits and challenges of each type of mechanism.
What is the total conversion cost : In the manufacture of 9,200 units of a product, direct materials cost incurred was $173,900, What is the total conversion cost
What are ethical considerations-dilemmas human resources : What are ethical considerations/dilemmas that human resources managers might face in their jobs and how they might go about resolving each issue. Please describ

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd